Determine the Net Deductible Casualty Loss on the Schedule a for Alan

question 9

Essay

Determine the net deductible casualty loss on the Schedule A for Alan Michael when his adjusted gross income was $40,000 in 2013 and the following occurred:
A and B were destroyed in the same casualty in March.C was destroyed in a separate casualty in July.
All casualty losses were nonbusiness personal use property losses and none occurred in a federally declared disaster area.
What is the amount of the net deductible casualty loss?

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Definitions:

Periodic Inventory System

A method of inventory valuation where updates to inventory levels and cost of goods sold are made periodically at the end of an accounting period, rather than after each sale or purchase.

LIFO Method

An inventory valuation method that assumes the last items placed in inventory are the first sold during an accounting year.

Cost of Goods Sold

The direct costs attributable to the production of the goods sold by a company, including materials, labor, and overhead.

Weighted-Average

A calculation that takes into account the varying degrees of importance of the numbers in a data set, giving more weight to some numbers than others.